Transaction enrichment takes raw bank transaction data, cryptic references, merchant codes, amounts, and transforms it into clearly categorised, structured financial information. In underwriting, this means automatically classifying income sources, recurring expenses, debt repayments, gambling activity, and spending patterns so that affordability and creditworthiness assessments are based on a complete, accurate picture of a consumer's financial life rather than partial or self-reported data.

Yes. When underwriting decisions are based on a complete, accurately categorised view of a consumer's financial position: real income patterns, actual committed expenditure, existing debt servicing lenders make better-informed decisions. This leads to more appropriate credit limits, fewer loans granted to consumers who can't sustainably repay, and ultimately lower default rates.

The Consumer Credit Directive 2 (CCD2) is the EU's overhaul of consumer lending rules, replacing the 2008 directive. Member states must transpose it into national law by 20 November 2025, with full application from 20 November 2026. It significantly expands scope, bringing in BNPL, small loans under €200, revolving credit lines, and leasing with purchase options and raises the bar for how creditworthiness assessments must be conducted and documented.

CCD2 demands that creditworthiness assessments are proportionate, forward-looking, and based on reliable financial data. Traditional credit information or raw bank transactions don't meet that standard, a string like "POS 4829 REF7734821" tells an underwriter nothing about affordability. Enrichment converts this into structured categories (rent, utilities, loan repayments, discretionary spending) that can directly feed creditworthiness models. Without it, lenders are either relying on incomplete data or burning analyst time manually categorising transactions.